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Manufacturing Strategy Syllabus

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Manufacturing Strategy Syllabus

  1. 1. Red McCombs School of Business The University of Texas at Austin MAN 367 STRATEGIC SUPPLY CHAIN MANAGEMENT Spring 2005 Professor James A. Fitzsimmons Classroom: CBA 4.304 CBA 3.238; 471-9453 Meeting MW 8-9:30 Office Hours: MW 9:30-11:30 Unique No.: 03165 www.mccombs.utexas.edu/faculty/James.Fitzsimmons James.Fitzsimmons@mccombs.utexas.edu Course Description The supply chain is viewed as beginning with product and process design and includes distribution, supplier management, customer service, and environmental impact. Topics will include systems thinking, project management, supplier management, international sourcing, supply chain logistics, customer service, new product innovation, process analysis, process simulation, focused operations, and environmental strategy. The impact on business strategy of the many dimensions of competition such as process development, quality, outsourcing, mass customization, and lean production will be explored. Suppliers Supplier Recycling/Remanufacturing Process and Customer Manufacturing Distribution Retailing Customer Product Service Design OPERATIONS MANAGEMENT VALUE CHAIN Material transfer Information transfer A major theme throughout the course is the development of skills to think strategically. We will look at a range of strategic decisions within the supply chain and how they affect the ability of the firm to achieve its goals. To practice our systems thinking skills, cases will be used throughout the course. These cases will have a decision orientation, with a specific manager having responsibility for developing action plans. In summary, the course should prepare you to build and lead an organization to achieve its objectives though a supply chain framework guided by the principles of systems thinking. COURSE OBJECTIVES (1) To develop skill in the use of systems thinking for understanding a situation and correcting the system without incurring unwanted consequences. (2) To acquire the capability to manage projects using Microsoft Project.
  2. 2. (3) To view project management systems as a "critical chain." (4) To develop habits of orderly thinking and rigor in formulating, evaluating, and recommending strategic operations initiatives. (5) To analyze processes using the animated computer simulation software, ServiceModel. (6) To appreciate the value chain context of operations management. CASE METHOD AND CLASS PARTICIPATION The case method is used throughout the course. To help in case preparation suggested "Study Questions on the Case" are included in the detailed course outline following each case abstract. These questions should serve only as a starting point. You should decide what the key issues are and how they can best be addressed and where possible apply systems thinking principles. At the beginning of the class, one or more class members will be asked to start the session by addressing a specific question. Anyone who has prepared the case should be able to handle such a leadoff assignment. After a few minutes of initial analysis and recommendations, we will open the discussion to the rest of the class. As a group we will try to build a complete analysis of the situation through a learning dialogue using systems thinking principles when appropriate. You are expected to be an active participant throughout the entire class and to contribute to the quality of the discussion. Please note that the frequency (i.e., the quantity) of your interventions in class is not a key criterion for effective class participation. The classroom should be considered a laboratory in which you can test your ability to use systems thinking principles to create a learning environment. Criteria that are useful in measuring effective class participation include: (1) Is the participant a good listener? (2) Are the points that are made relevant to the discussion? Are they linked to the comments of others? (3) Do the comments show evidence of analysis of the case? (4) Is there a willingness to participate? (5) Is there willingness to test new ideas, or are all comments "safe"? (For example, repetition of case facts without analysis and conclusions does not add value.) (6) Do comments clarify or build upon the important aspects of earlier comments and lead to a clearer understanding of the case? An important element of this class is group work. You are expected to form your own study group (4 students) by the end of the third week of class. Each group will be responsible for preparing three written case assignments and one case presentation. The cases available for written analysis and presentation are listed at the end of the syllabus. 2
  3. 3. WRITTEN ANALYSIS OF CASES As a team you are asked to prepare two written cases of your choice (see last page for case selection) and one computer case analysis using ServiceModel (Renaissance Clinic due 2/28). As an individual assignment you will use MS Project to prepare the Paymor Shopping Center case due 3/21. The written assignment involves a thorough analysis of a case, but you are limited to five pages, typed double-spaced, plus exhibits. The assigned study questions for the cases are shown in the detailed outline section of this course description. At a minimum these study questions on the case must be addressed in the written analysis. (1) Papers should be printed, double-spaced, with normal margins. The name of the case should be on the first page of the text with your names, date, and course number. (2) The page limit for each paper is five pages of text, plus exhibits. Note that these are maximum limits. Papers should be concise and coherent. (3) Exhibits should contain specific types of analyses (such as financial, break-even, comparison, cost, competitive, etc.) and information that supports and is relevant but would be too detailed for the body of the paper. (4) Please proofread your paper before turning it in. Papers for this course should be of the same quality that you would provide to the management of the business. BOOK REPORT A book report on the Critical Chain is an individual assignment due on the day the book is discussed in class as shown in the course outline. The written report is limited to five pages, typed double-spaced, plus exhibits. The assigned questions must be addressed as a minimum with further elaboration or reflections on the book welcomed. The guidelines above for written analysis of cases apply to the book report also. CLASS BEHAVIOR AND INDIVIDUAL NORMS Because every faculty member has somewhat different expectations as to class behavior and individual norms, I'd like to outline a few of mine at the outset. (1) Please let me know in advance if you must miss a class. If you do miss a class, please find out from a classmate what additional assignments might have been made, and what handouts you may have missed. (2) To help me learn your names as quickly as possible, I'd like you to use a name card in class. During the third class, I will pass around a seating chart and ask you to use the same seat for duration of the semester. (3) Preparation of the case and thinking about the assigned questions is essential for a stimulating and rewarding class experience. (4) For purposes of general class preparation, group work is acceptable and encouraged. (5) I will try very hard to use the class time effectively and request that you do the same. This includes starting and ending on time. 3
  4. 4. GRADING Your course grade will be based on the following team and individual activities with weights as shown: Team Renaissance Clinic Computer Case (due 2/28) 15% Written Case Analysis 2@10% 20% Individual Critical Chain Book Report (due 2/21) 15% Paymor Shopping Computer Case (due 3/21) 15% Quiz 2@10% 20% Class Participation 15% 100% Interpretation of Grades Grade Meaning Attributes 10 Outstanding Creative analysis exceeding expectations 9.5 Excellent Flawless in execution 9 Good Well done with minor blemishes 8.5 Journeyman Addressed all issues but without creativity 8 Struggling Lack of depth in addressing issues 7.5 Lackluster Real mistakes in understanding 7 Incomplete Missed the point in addressing some issues 5 Why bother An embarrassment Note: Grades are final and no make-ups are permitted. Give it your best shot! BOOKS AND COURSE PACKET The following materials are required for the course: Eli Goldratt, Critical Chain, North River Press, 1997. 0-88427-153-6 A Course Packet of cases is available at the GSB Copying Center. 4
  5. 5. MODULE 1: PROCESS ANALYSIS Session #1 (January 19): THE BUSINESS OF PARADIGMS Paradigms determine the way we see the world and our future. They help us evaluate and organize new information, but paradigms also can limit the way we look at life. Our paradigms can be so deeply rooted, so unquestioned, that they can become barriers to our ability to see new opportunities. The "old way" may seem like the "only way." Video: The Business of Paradigms with Joel Barker (38 min.) - Call No. 2075 Discussion Questions on the Video: 1. When does a paradigm shift? 2. How can one anticipate a paradigm shift? 3. What skills are required to challenge assumptions? 4. How can imagination be a competitive resource? Session #2 (January 24): PROCESS ANALYSIS Reading: Glossary of POM Terms 9-687-019 Case: Kristen's Cookie Company (A) 9-686-093 A university student living on-campus has decided to start a fresh baked cookie business out of his apartment. This simple make-to-order business provides an opportunity to use tools of process analysis such as process flow diagrams and Gantt charts to address questions about the feasibility of the business. Study Questions on the Case: 1. Answer the Key Questions. 2. Answer the Problems for Further Thought. 3. Construct a Gantt chart when the batch size is 2-dozen cookies. 4. For a 2-dozen batch size, is it possible to do it on your own? Why or why not? Session #3 (January 26): CAPACITY ANALYSIS Reading: Capacity Exercise: Fishing Fleet and Cannery A firm operates both a fleet of fishing boats and a cannery. All fish brought in by the firm's fleet are processed at its own cannery. Read the note and the fishing fleet and cannery exercise. Be prepared to answer the questions at the end of the exercise. Game: Yield Management Analyst Session #4 (January 31): MANUFACTURING PROCESS ANALYSIS Case: National Cranberry Cooperative 9-675-014 National Cranberry is a New England cooperative that processes water-harvested and dry berries from local farmers. Farmers have been complaining about the excessive delays waiting for their trucks to unload fruit at 5
  6. 6. the receiving plant. A suggestion has been made to invest in two new dryers at $25,000 each and convert dry berry holding bins to store wet-harvested berries at a cost of $5,000 per bin. Study Questions on the Case: 1. Develop a process flow diagram and identify the bottlenecks. Show only the necessary level of detail – a common mistake is to have far too much detail. Note that dry and wet berries share some resources (dechaffers and separators). Assume that 2/3 of these capacities will be allocated to wet berries reflecting the anticipated 70% wet berry harvest in 1971. 2. Why are the delivery trucks waiting so long? Draw an inventory buildup diagram to examine the buildup of inventory at the wet bins. Assume that 18,000 barrels of berries (of which 70% are wet) arrive uniformly over a 12-hour day and that the plant starts processing at 7:00 am when the first truck arrives. What can you conclude about truck waiting times from this diagram? 3. Make recommendations for reducing overtime costs, decreasing truck waiting time, and improving the overall profitability of NCC. Validate your recommendations with a revised inventory buildup diagram. Video: Ocean Spray (10 min.) Session #5 (February 2): SERVICE PROCESS ANALYSIS Case: Manzana Insurance – Fruitvale Branch A competitor that has promised a one-day turnaround for all its agents is challenging Manazana, a property insurance firm. Manazana must redesign its property insurance process to improve its response time performance. Queuing analysis will be used to evaluate proposed improvements in the process. Study Questions on the Case: 1. Does Manzana have adequate capacity to process the demand for requests? If, yes, why are the average turnaround times averaging 5-6 days when the standard processing times are in hours? 2. How important are policy renewals to Manzana's future? How is the demand for RERUNs different from that of all other requests? 3. It is commonly believed at Fruitvale that RUNs are the most profitable jobs? Is this belief justified? 4. Recommend a process redesign that will compete with the one working day turnaround guarantee offered by Golden Gate. Support with queuing analysis. 5. Discuss implementation issues associated with your redesign including staffing, reorganization, personnel training, and information technology needs. Session #6 (February 7): SERVICE MODEL DEMO (Meet in Computer Lab) Readings: SerivceModel Student Module, Exercise1: Call Center, Exercise 2: WIDGETS Case: Pronto Pizza Pronto Pizza is a delivery-only pizza service that promises delivery within 40 minutes of receiving a call for an order or the customer gets $2 off the price. Pronto employs a single pizza maker, paid $10 per hour, who can make, on the average, one pizza every three minutes. This service time has a negative exponential distribution. Pizzas are placed in a large oven with a capacity for ten pizzas to bake for approximately 12 minutes. The one- way travel time to deliver a pizza in the market area averages 10 minutes, with negative exponential distribution. Calls for pizza average one every five minutes, with negative exponential distribution. Drivers who use their own cars are paid $8 per hour to deliver pizzas to one customer at a time. Study Questions on the Case 6
  7. 7. 1. Draw a process flow diagram and identify the bottleneck operation. 2. Use the ServiceModel computer simulation software and Pronto.pkg file, to determine the number of drivers that minimizes the total cost of salaries and guarantee discounts. 3. Using queuing formulas calculate the expected waiting time in the order preparation queue. Compare this value with your simulation result and comment. 4. Based on your simulation recommended staffing level, what is the probability of paying off on the guarantee? 5. What do you think of this service guarantee policy? 6. What other design or operating suggestions could improve Pronto Pizza's performance and customer service? Note: Class will meet in Mod East Computer Lab, CBA 5.325 Session #7 (February 9): SERVICE MODEL TUTORIAL (Meet in Computer Lab) Reading: Exercise 3: Reengineer Order Processing System In a tutorial session a simulation model of an order processing system will be modeled and run. Note: Class will meet in Mod East Computer Lab, CBA 5.325 Session # 8 (February 14): CAPACITY PLANNING (Meet in Computer Lab)) Case: Renaissance Clinic (Group Project) Renaissance Clinic provides dedicated obstetric and gynecological services. The medical treatment at this facility is wrapped in an exclusive-feeling physical environment that is distinctly unique to Austin. The practice is intimate - only a receptionist and a nurse clinician assist Dr. Thompson. Study Questions on the Case: 1. Assume the waiting lines at the receptionist, the nurse clinician, and the doctor are managed independently with a FCFS priority. Model this system using ServiceModel to determine the utilization of each resource (receptionist, nurse clinician, and physician) and the distribution of time in the system for an arriving patient. Begin by selecting the Build menu - Background Graphic - Behind Grid. Then select the Edit menu - Import Graphic - Pracmod. This will give you an office floor plan on which you can arrange furniture. 2. If you could hire one more person to augment the staff, what position would be your choice (receptionist, nurse clinician, or physician)? How would the clinic performance measures determined above change? 3. What further advice would you give Dr. Thompson on the operation of her clinic? Note: Class will meet in Mod East Computer Lab, CBA 5.325 Session #9 (February 16): Project Day (Meet in Computer Lab) Note: Class will meet in Mod East Computer Lab, CBA 5.325 7
  8. 8. MODULE 2: PROJECT MANAGEMENT Session #10 (February 21): Critical Chain Readings: Critical Chain book report due addressing the following questions: Questions: 1. What key insights about project management has the author discovered? 2. Compare the concepts in the Goal with those in the Critical Chain. For example, the “bottleneck” in the Goal is equivalent to the “critical path” in the Critical Chain. 3. Explain the concept and use of time buffers. 4. How can the Critical Chain be expanded to account for multiple concurrent projects? Session #11 (February 23): MANAGING PROJECTS Lecture and discussion on project management topics beginning with project initiation using work breakdown schedules. Project management techniques such as variance analysis and earned value charts will be explored. Finally, we will discuss techniques for project controls, auditing, and methods for project termination. Video: Alton Bridge (15 min) Session #12 (February 28): MICROSOFT PROJECT (Meet in Computer Lab) Case: PERTing the Pumping Unit An oil well located in West Texas has been drilled and capped. Now a pumping unit must be installed to bring the well into production with a pipe leading to a tank farm at some distance away. Study Questions on the Case: 1. Based on the description of the project activities compute the expected time and variance of each. Note that each activity has an optimistic (a), pessimistic (b), and most likely time (m) assessment. Recall that the expected activity time is calculated as (a+4m+b)/6 and activity variance as [(a+b)/6]2. 2. Draw an activity on node arrow diagram for the project. 3. In class, using Microsoft Project, we will determine the critical path and expected completion time of the project and determine the probability of completing the project in 54 hours assuming around the clock activity. Note: Class will meet in Mod East Computer Lab, CBA 5.325 Session #13 (March 2): PROJECT DECISON MAKING (Meet in Computer Lab) Case: Paymor Shopping Center (A) (B) (C) (Individual Case) Ingerson Associates, a general contractor, is in the process of completing a four-store addition to Paymor Shopping Center. Mr. Puckett, the owner, has approached Ingerson with a request to build a tire sales and service shop on the shopping site with its completion ready for the grand opening of the four store addition in 58 days. Study Questions on the Case (A): 8
  9. 9. 1. Using MS Project for Windows determine how long should this project take without reducing the time to do any activity? 2. The activities involving electrical work, plumbing, millwork, and trim are subcontracted. At what date should these activities be scheduled? What flexibility does Ingerson have in scheduling the subcontractors? Does the Critical Chain have anytime to say about this decision? 3. What activities are good candidates for reducing the project completion time? Study Questions on the Case (B): 1. Compute the expected time and variance for the critical path activities. 2. Determine the probability that the project will be completed in 58 days or less, assuming the interior painting commences two days after the start of wallboard installation. 3. Why might you be suspect of the probability calculated above? Study Questions on the Case (C): 1. Using the expediting alternatives, which activities should be crashed, and by how much, if the project is to be finished in 58 days? 2. How much additional cost would be required to reduce the completion time to 58 days? Note: Class will meet in Mod East Computer Lab, CBA 5.325 Session #14 (March 7): Quiz 1 Session #15 (March 9): Project Day (Meet in Computer Lab) Note: Class will meet in Mod East Computer Lab, CBA 5.325 MODULE 3: STRATEGIC ELELMENTS OF THE SUPPLY CHAIN Session # 16 (March 21): Guest Speaker: Session #17 (March 23): NEW PRODUCT INNOVATION Case: Alaska Airlines 9-800-004 Alaska Airlines, serving west coast cities from Prudhoe Bay, Alaska to Puerto Vallarta, Mexico, has won awards for providing outstanding customer service. Faced with price competition from Southwest Airlines, Alaska is introducing frontline technology and customer self-service options to improve productivity and reduce costs. Study Questions on the Case: 1. What benefits do Alaska customers gain from technology driven self-service innovations? Is it possible for self-service to be viewed by customers as improved service? How could technology that facilitates self- service increase customer loyalty? 2. What is your assessment of Alaska Air's use of technology? Consider the impact of each new technology initiative on employees, competitors, and customers. 9
  10. 10. 3. Critique the new technology development process used by Alaska Airlines. 4. Will Alaska Airline's leadership in technological innovation provide a sustainable competitive advantage? Video: Southwest Airlines: Herb Kelleher and His Airline (12min.) Session #18 (March 28): PROCESS DEVELOPMENT Case: Chaparral Steel: Rapid Product and Process Development 9-692-018 Located outside Dallas, TX, Chaparral Steel has been a successful mini-mill producing standard "I" beams for the construction industry using recycled auto bodies. With an interest in the more profitable wide- flange beams, Chaparral has been experimenting with a new continuous casting process called "near net shape" that will cast molten iron into a "dog-bone" shape requiring fewer rolling passes. Study Questions on the Case: 1. What competitive strategy has Chaparral Steel chosen (i.e. low cost, differentiation, or focus)? Explain. 2. What features of the Chaparral process technology, organizational culture, and facility location support its competitive strategy? 3. Is Chaparral Steel an example of a learning organization? Explain. 4. Should Chaparral expand its Midlothian site or construct a new facility? Video: Chaparral Steel (15 min.) Session #19 (March 30): FOCUSED OPERATIONS Case: Southwest Airlines-1993 (A) 9-694-023 Southwest Airlines, the only major U.S. airline to be profitable in 1992, makes a decision as to which of two new cities to open, or to add a new long-haul route. This case provides a window into Southwest’s strategy, operations, marketing, and culture. Lessons can be learned how an airline can simultaneously be a low-cost leader, service leader, and profit leader. Assignment Questions: 1. How has Southwest been able to combine low-cost operations with high perceived service quality? 2. Can other service firms emulate the Southwest service model? 3. Evaluate the three route expansion options and make a recommendation. Video: Interview with Herb Kelleher (10 min.) Session #20 (April 4): EXCELLENCE IN QUALITY Case: The Pursuit of Quality at AT&T Universal Card Services (A) 9-694-047 As part of its overall strategy for “delighting” customers, Universal Card Services, a wholly owned financial services subsidiary of AT&T has created a comprehensive quality measurement and compensation system. Through multiple measures of both internal process performance and external customer satisfaction Universal Card Services attempts to achieve rapid identification of process problems, ongoing assessment of customer satisfaction, and motivation of employees to sustain high levels of customer service. Despite the company’s success, its management continues to struggle to balance the basic tensions that arise from linking compensation to performance measurement. 10
  11. 11. Study Questions on the Case: 1. Assess the strengths and weaknesses of Universal Card Services quality systems with respect to (1) measurement system, (2) compensation system, and (3) problem solving/process improvement system. 2. Is the Universal Card Services system really a quality system or just a compensation system? What quality tools are missing and how might they be used? 3. How do you explain the high levels of employee satisfaction (see Exhibit 6) given such a stressful job working under conditions of call monitoring and meeting daily performance standards? 4. Assuming that the system will not be abandoned, make recommendations for modifying or realigning the system to sustain it into the future. Video: National Association of Realtors Call Center (12 min.) Session #21 (April 6): FIELD SERVICE Case: Otis Elevator: Managing the Service Force N9-191-213 The high margin service business of Otis Elevator is under attack from small local providers. Poor communications have resulted in nonproductive travel and preventative maintenance is being shortchanged because of unscheduled callbacks. Emerging communications technologies and scheduling software provide an opportunity to significantly improve the productivity of the field force. Study Questions on the Case: 1. Discuss the relationship between elevator maintenance and callbacks as it relates to field service productivity. 2. What are the advantages and disadvantages of the three field maintenance organizational structures (Boston, Glendale, and Dallas)? 3. Why might there be opposition to KDT and the OSM software from the mechanics? How would you overcome this opposition? 4. Provide Rick Whitaker with a plan and timetable that will incorporate the emerging communications technology and scheduling software into a more competitive field service force. Should we be talking about reengineering here? Lecture: Vehicle Routing Algorithm Session #22 (April 11): MASS CUSTOMIZATION Case: National Bicycle A mass producer of bicycles is considering the introduction of a make-to-order system called POS (Panasonic Order System), which will use a measuring stand at the retail store to allow the manufacture of a custom fit bicycle. Study Questions on the Case: 1. Describe the differences between the mass and POS production processes. 2. How does the cost of producing and delivering a bicycle to a customer under POS compare to mass production? 11
  12. 12. 3. In Exhibit 19, we see that each POS bike requires 17 different parts from inventory. Assume that the probability of an individual part being of stock in the POS factory is thus same as that in mass production (0.994 from page 10) and each part is available independently. Assuming sales of 250 bicycles per week, how many POS bicycles will experience part shortages? What are some options from strategic to tactical and from proactive to reactive to reduce the number of part shortages? 4. What lead-time should National Bicycle offer to their POS customers and why? Session #23 (April 13): LEAN PRODUCTION Case: Toyota Motor Manufacturing, USA Inc. 1-693-019 At its Georgetown, Kentucky plant a growing number of cars are sitting off-line with defective seats or are missing them entirely. The plant is determined to solve the problem using the famed Toyota Production System. Study Questions on the Case: 1. What are the key operational principles of the Toyota Production System (TPS)? Be sure to understand not only the terms, but their fundamental purpose as well. 2. Estimate the cost of the defective seats to the company. You will have to make several assumptions based on material provided in the case. Be especially careful that you understand how stopping an individual workstation leads first to delays for the line segments and ultimately to delays for the entire line. 3. Doug must balance the immediate costs of following TPS against the long-term costs of deviating from TPS. Discuss this tradeoff in detail. 4. What would you do to address the seat problem? How would your proposed solution affect the company both in the short term and in the long term? Video: Nissan – Oppoma Plant (12 min.) Session #24 (April 18): OUTSOURCING Case: Taco Bell Corp. 9-692-058 Taco Bell is a fast food restaurant chain serving Mexican food reformulated to appeal to the American general public. As of 1991, the company had gone through a remarkable transformation and was hailed by the press and industry experts as having revolutionized the fast food world. In a period when most other fast food chains experienced flat domestic sales and declining profits, Taco Bell was profitable and increased its market share. Study Questions on the Case: 1. Contrast the first phase improvements with the second phase. Could you characterize these changes as reengineering? 2. What was the impact of K-Minus on employees, managers, and customers? 3. What was required to achieve the flattened organization structure with new roles for middle managers? 4. Does Taco Bell now have a sustainable competitive advantage in the fast food industry? Session #25 (April 20): RECYCLING AND REMANUFACTURING Reading: “Recycling” by Wenyih Lee Case: Australian Paper Manufacturers (A) 9-691-041 12
  13. 13. New found manufacturing capability is used as weapon to invade the market of a strong incumbent with careful attention to growing environmental concerns in the industry. The expansion requires consideration of financial, strategic, and ethical considerations. Study Questions on the Case: 1. What opportunities and risks did Ken McRae face as he contemplated taking Australian Paper into the fine papers market? Be specific with respect to technological, operations, and capital investment (as well as other) considerations? 2. How has the environment fared in this battle? 3. As Ken McRae, what technology and operations strategy options are available? Which do you think he ought to pursue? Why? 4. What is the strategic advantage of closing the recycling loop? Session #26 (April 25): ROBUST DESIGN Reading: "Robust Quality" Exercise: Paper Airplane Design Read the "Introduction to Parameter Design." Come to class prepared to build a paper airplane and conduct a Taguchi experimental design exercise. Session #27 (April 27): FACILITY LOCATION Reading: Service Facility Location Case: Athol Furniture, Inc. Athol Furniture is considering three potential sites upon which to build a store in Bluff Lake where two competing stores currently share the market. Athol does not wish to consider a store smaller than 10,000 square feet and only in increments of 5,000 square feet up to the maximum allowable size limit for the site. Study Questions on the Case: 1. Read the note “Service Facility Location.” Use the Huff Spreadsheet Model (with λ = 1.0), to recommend a store size and location for Athol Furniture, Inc. 2. What is the expected annual net operating profit before taxes and expected market share for the outlet you have recommended? Defend your recommendation. 3. Try two other values of λ (e.g., 0.5 and 5.0) to measure the sensitivity of customer travel propensity on your recommended location. 4. Briefly state any shortcomings you may perceive in using the Huff model. Session #28 (May 2): Quiz 2 13
  14. 14. MAN 367 STRATEGIC SUPPLY CHAIN MANAGEMENT Spring 2005 Course Outline Fitzsimmons Session Date Topic Case Module 1: Process Analysis 1 1/19 The Business of Paradigms 2 1/24 Process Analysis Kristen's Cookie 3 1/26 Capacity Analysis Fishing Fleet/Cannery 4 1/31 Manufacturing Process Analysis National Cranberry 5 2/2 Service Process Analysis Manzana Insurance 6 2/7 ServiceModel Demo (meet in lab) Pronto Pizza 7 2/9 ServiceModel Tutorial (meet in lab) 8 2/14 Capacity Planning (meet in lab) 9 2/16 Project Day (meet in lab) Renaissance Clinic Module 2: Project Management 10 2/21 Critical Chain book report due 11 2/23 Managing Projects 12 2/28 Microsoft Project (meet in lab) Pumping Unit 13 3/2 Project Decision Making (meet in lab) 14 3/7 Quiz 1 15 3/9 Project Day (meet in lab) Paymor Shopping Spring Break Module 3: Strategic Elements of the Supply Chain 16 3/21 Guest Speaker 17 3/23 New Product Innovation Alaska Airlines 18 3/28 Process Development Chaparral Steel 19 3/30 Focused Operations Southwest Airlines 20 4/4 Excellence in Quality AT&T Card Services 21 4/6 Field Service Otis Elevator 22 4/11 Mass Customization National Bicycle 23 4/13 Lean Production Toyota Motor 24 4/18 Outsourcing Taco Bell 25 4/20 Recycling and Remanufacturing Australian Paper 26 4/25 Robust Design 27 4/27 Facility Location Athol Furniture 28 5/2 Quiz 2 29 5/4 Wrap Up 14
  15. 15. MAN 367 STRATEGIC SUPPLY CHAIN MANAGEMENT Case Write-up Choices Date Case Make 5 Choices in Order of Priority 3/23 Alaska Airlines 3/28 Chaparral Steel 3/30 Southwest Airlines 4/4 AT&T Card Services 4/6 Otis Elevator 4/11 National Bicycle 4/13 Toyota Motor 4/18 Taco Bell 4/20 Australian Paper Team Members: ________________________________ _________________________________ _________________________________ _________________________________ E-mail Correspondent _________________________________ 15

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